Court: FCC Can't Enforce Net Neutrality

The U.S. Court of Appeals for the D.C. Circuit has struck down a provision of the Federal Communications Commission's "Open Internet Rules." That provision allowed the FCC to regulate Internet service providers in much the same way it regulates phone service providers — requiring them to provide unrestricted service to all users.

Over the years, Americans have grown used to getting anything they want when they want it on the Internet. But yesterday a federal appeals court ruled that the Federal Communications Commission cannot require Internet providers to offer unfettered access. It was Verizon that brought the case against the FCC. The ruling could have far-reaching implications for what's known as net neutrality. Here's NPR's Laura Sydell to help us out with what all this means. Welcome.

LAURA SYDELL, BYLINE: Hello. Good morning.

MONTAGNE: First, do give us some background on the case, how it came about.

SYDELL: Back in 2010, the FCC passed rules to support so-called net neutrality. And this means that broadband providers must treat all traffic on the Internet exactly the same. So you can't discriminate between a Democratic website and a Republican website. And the rules got set up after the FCC tried to punish Comcast for secretly slowing some traffic on its networks.

Comcast got caught doing this when a guy who was sharing barber shop quartet songs noticed his network slowed down when he used the file sharing software Bit Torrent. The Associated Press confirmed his experience when it tried to upload the Bible with Bit Torrent, and the FCC took Comcast to court but lost. The court told the FCC that it didn't have rules in place to use against Comcast.

So the FCC came up with the open Internet rules. And that is where we got to this moment.

MONTAGNE: What was the basis on which Verizon challenged the rule?

SYDELL: Verizon argued that the FCC had no right to make those rules in the first place because the FCC didn't give itself the right. A few years back the commission decided that the Internet would not be regulated like a telephone line. Phone lines are heavily regulated. They're considered common carriers and therefore they're necessary for public communications.

The FCC decided it was going to be much lighter when it came to regulation on the Internet. It classified it differently. So Verizon essentially argued that since the FCC had classified it differently, it had no right to regulate the Internet so heavily and to tell them what to do. The FCC did try to reclassify Internet connections and what happened was the Republicans in Congress said we don't want you to reclassify it.

They got upset because they didn't want more regulation on the Internet.

MONTAGNE: OK then. So what does this new ruling by this federal appeals court mean for us consumers?

SYDELL: It means that theoretically your broadband provider can decide to slow or block particular websites. One of the arguments that the Internet service providers make is that Netflix and Google don't have to pay for fast access to your house, so that they might simply start charging companies if they want a faster line to the consumer, and that may bring up your prices.

And it could make it a lot more expensive for the next startup that might challenge Netflix or YouTube. They'd have to pay extra for a fast connection to you or strike a deal with Verizon. And I should add that Google and Netflix do pay to connect to the Internet. This is really about the last mile into your house, and the Internet service providers want to charge extra for that.

Netflix in particular is in the crosshairs here because more than 30 percent of Internet traffic at peak times comes from Netflix, according to studies. So Verizon might say, Netflix, you need to pay us more. Or maybe Verizon strikes a deal with Amazon and says your prime video service can get speedier delivery to the home and we're going to slow down Netflix.

MONTAGNE: And so what does this mean, Laura? Is the battle over?

SYDELL: Well, the FCC does have a few options here. It could appeal the decision. It could try and go back to the drawing board and come up with some new rules that fit with the decision, or it can try to reclassify broadband once again.

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